Food Hall Trend Hits St. Paul With Keg & Case Market

A rendering from Studio M Architects shows the exterior of Keg & Case Market, the first food hall coming to St. Paul.

Workers are swarming the former Schmidt Brewery keg and case house, transforming the old structure into the aptly named Keg & Case Market.

This will be St. Paul’s first large-scale food hall, with 32,000 square feet of restaurants, coffee shops and food vendors. Sit-down establishments will line the building perimeter, with market stalls in the center. Owner-developer Craig Cohen and his tenants are working toward an opening later this summer.

Frogtown’s Hmongtown Market, which opened in 2004, and Hmong Village, which opened in 2010 on Johnson Parkway, have many unique food vendors, but both also offer a wide range of other wares, including fashion, trinkets and housewares. For Cohen, it’s all about offering a unique food experience.

“It’s very exciting to bring this type of development to St. Paul,” he said.

The Keg & Case project, which is coming in at just under $10 million, is utilizing a mix of public and private financing to get work done. Cohen had to get a commercial development district approved by the city council to get on-sale liquor licenses for the restaurants.

“It’s been a lot of work, and countless details,” he said.

The keg house was owned by the West 7th/Fort Road Federation, which still owns the brewery’s rathskeller/office building and plans to put a restaurant and banquet space in there. The keg house and rathskeller/office are two of the most challenging brewery buildings to redevelop, said Ed Johnson, executive director of the West 7th/Fort Road Federation. The bottling house and castle-like brew house are artists’ lofts. An aquaculture fish and greens-growing business is in a former warehouse.

Cohen has been working on his project for more than two years. One big obstacle he noted was cleanup of contaminated materials: “We didn’t know the extent of lead inside the building. There was lead paint on the ceiling, lead paint on the walls, and lead paint on the beams. It was one big contaminated shell.”

Mike Temali, CEO of the nonprofit Neighborhood Development Center, is watching Keg & Case and similar developments nationwide with interest. NDC in 2006 opened Midtown Global Market in the former Lake Street Sears store in Minneapolis, and in 1998 worked with community groups to start Mercado Central, a market of vendors of food and other wares down the street.

NDC was pleased to see Midtown ranked by a December 2016 Cushman & Wakefield study as one of the nation’s top 20 food halls, said Temali.

“That was great recognition for the work all of us have done to transform that space,” he said, noting what’s unique about Midtown is that it had to become its own destination and evolve into a foodie destination. Most other food halls are in tourist areas or places convenient to the workday lunch crowd, and “Midtown isn’t either of those,” he said.

That study, Food Halls of America, tracks the explosive growth of food-centered retail since the recession and ranks the top 10 food hall concepts in New York City and the top 20 nationally, including the Midtown Global Market in Minneapolis.

“No other retail category has generated as much aggressive expansion over the past few years as food-related retail—and arguably, there is no hotter trend within that category than food halls,” said Garrick Brown, vice president of retail research for the Americas at Cushman & Wakefield.

In the first nine months of 2016, food hall growth increased by 37 percent, with 18 more projects slated for delivery before the end of the year, according to the report. As recently as a decade ago, food-related retail concepts were more about convenience than quality. But fueled by the rise of a “foodie” movement led by celebrity chefs and ushered in by millennials, food-centered social media platforms, and culinary-focused cable channels, food halls slowly began to enjoy previously unprecedented cache, Brown said.

“The food hall trend is one we’re going to see much more of,” agreed Temali. Not only does it reflect growing interest in dining and food shopping as an experience, food halls also provide a viable way to reuse buildings left vacant as customers abandon brick-and-mortar storefronts or industries go idle.

Cohen and his tenants speak of synergy as they eye the opening of Keg & Case.

“We’ve got a strong tenant mix and they’ll bring some good synergy to the development and the neighborhood,” Cohen said. The building is full, in terms of restaurant tenants. The mix of market stall vendors is still being determined. Two hopefuls, Levee Juice and Clutch Brewing, are in the chase this spring for city sales tax grants and loans.

Christina Nguyen, co-owner of the popular Hola Arepa in Minneapolis, is eager to open in a new space in St. Paul.

“We’re very excited about Keg & Case,” she said. “We’re excited to be opening in St. Paul, and to have a chance to be part of something new.”

Hola Arepa’s food truck has been part of Midtown Global Market, and Nguyen has a strong appreciation for the benefits a food hall can bring for business owners and diners alike.

“Food trucks and restaurants can develop a much larger customer base. It’s great synergy,” she said. Hola Arepa will have inside dining and patio space.

Two anticipated restaurant tenants are Thomas Boemer and Nick Rancone, owners of Corner Table in Minneapolis and the Revival restaurants in St. Paul and Minneapolis. They have not announced their West 7th restaurant name, but have plans for a huge wood-burning hearth, where all of the cooking and baking will be done. The restaurant will have about 120 seats, spread out over two levels and around the hearth. Minneapolis’ Five Watt Coffee will also open in the building.

Cohen is pleased with the restaurant mix.

“They all bring something unique to St. Paul,” he said. “These are great lead tenants. I couldn’t be happier.”

The center of the building will have about 32 stalls for a market with a food focus. Growers, bakers, cheesemakers and other food products will occupy the stall.

“It will be carefully curated to bring in types of businesses people want,” said Cohen. “They’ll all be small-scale, mom-and-pop-type operators.”

Vendors will also be able to use a second-floor commercial kitchen. Plans for outside call for a band shell, space for a farmers market and the possibility of other activities. In the winter Cohen wants to have a skating rink.

Studio M Architects of Minneapolis is designing the project. Kalcon of Minnetonka is lead contractor.

“It’s been a long haul and we hit many delays but we think when we open the doors people will agree that it is worth the wait,” said Cohen.